The government will reduce taxpayer contributions to the railways in Britain by £3.6bn a year before 2019, in a move which rail groups and unions fear will lead to job losses, the closure of hundreds of ticket offices and higher fares.

The McNulty report claimed that some ticket offices in smaller stations should be closed, peak fares should rise even faster than inflation than at present, and that overall costs in the railways should be reduced by a third.

The Oyster card has been blamed by unions for the reduction in staffed ticket offices throughout the capital, but allows passengers to set up an 'auto top-up' which takes money straight from their bank accounts as they pass through the barriers at railway stations

Some believe that the cuts to the network are borne out of a need to divert funds to the government's controversial HS2 line, to be built between London and Birmingham in the first instance, and later to run further north. The head of the Office of Rail Regulation speculated that the changes were because of HS2 in a recent letter to the Financial Times.

Labour accused the government of putting the concerns of private train companies before passengers.

Shadow Transport Secretary Maria Eagle branded the decision "a dangerous experiment" which could lead to the break-up of the railway system. She accused Greening of passing the burden of cost to the fare-payers, rather than the train operating companies, which she claimed were making "huge profits".

Justine Greening said she accepted that passengers valued face-to-face ticket officers, but insisted that Labour also cut their opening hours while in office. She added that she was looking at ways of allowing people to buy train tickets at libraries, post offices and other local shops.

She insisted she wanted to "move ticketing into the 21st Century," to foster an approach where options for buying tickets were more in touch with people's lifestyles.